Right now, when you get accepted to college, each school sends you a financial aid offer that looks completely different from every other school's offer. This makes it nearly impossible to compare what you'd actually pay at one college versus another. This bill fixes that problem by requiring all colleges to use the same standardized form to show you exactly what college will cost and what financial aid you're getting.

The new form will clearly lay out all your costs upfront—tuition, fees, room and board, books, transportation, and other expenses—followed by a separate section showing all the free money you're getting (grants and scholarships you don't have to repay). Then it shows your "net price," which is what you'd actually owe after subtracting the free aid. The form will also clearly identify any loans the school recommends, making it obvious that loans have to be paid back, unlike grants. It will include information about federal student loans, private loans, work-study jobs, and even military education benefits if you're eligible.

Before colleges have to use this form, the Department of Education will spend about nine months testing it with real students and families to make sure it's actually easy to understand. The goal is simple: when you're deciding between colleges, you'll be able to look at each school's financial aid offer and actually understand what you're paying, what's free, and what you'd owe in loans. This should help students and families make smarter decisions about college affordability instead of being confused by different formats and unclear language.

Understanding the True Cost of College Act of 2023

Grassley, Chuck

Understanding the True Cost of College Act of 2023 This bill requires standardized financial aid terminology and offer forms. Specifically, the Department of Education (ED) must develop standard terminology and a format for financial aid offer forms based on recommendations from representatives of certain groups, including students, veterans, and institutions of higher education (IHEs). The consumer-friendly form must include specified details and disclosures, including the estimated cost of attendance, the net price that a student or family is estimated to pay, and the terms and conditions of financial aid. In addition, ED must (1) test the form with representatives of students, students' families, IHEs, secondary school and postsecondary counselors, and nonprofit consumer groups; and (2) use the results to develop the final form. Each IHE that participates in federal student-aid programs must (1) use the standard form when offering financial aid to students, and (2) use the standard terminology and definitions developed by ED for all communications related to financial aid offers.